Should you set a business end goal before you start?
People set up businesses for any number of reasons: to be their own boss, for location independence, to explore a personal interest, or to create a legacy for the family to take on.
Take us for example, we, at MBST UK found ourselves in a prime position to begin a new family run business venture and with our passion for health and fitness, the emerging MBST technology was the perfect product of choice.
However, no matter your motivation, identifying your end-game is a critical step in planning both a near-term and long-term strategy.
So, if you’re just starting up, take a moment and think— “Where’s my business headed?”
Grow to Sell
Often, we start a business in the pursuit of financial independence with a “grow quick and sell mentality.” This is understandable, but it’s important to appreciate the risks of such an approach. Every business needs to grow but achieving the desired trajectory is not always easy – so, be sure you have enough financial security to support the teething stages as your business finds its footing.
But if selling is your ultimate ambition, this must inform every decision you make: from the market you choose to your product positioning and branding, right through to networking on a daily basis.
Make sure you enter an industry with a history of acquisitions; even note down which companies you might approach down the line. This will ensure you are not entering a stagnant space with no prospects of selling. Plus, it will help you brand and position your product in such a way it could fit into your prospective buyer’s portfolio.
Then, strike up relationships with the respective people so, when the time comes to sell, you’re not just a stranger knocking on someone else’s door.
Build a Family Empire
Where some wish to secure personal wealth, others hope to create a family legacy. Businesses are a great way to build a future for those you love, guaranteeing employment and hopefully, a level of financial freedom.
But a couple of factors founders often forget are:
Will my offspring want to take on this business?
What if I have more than one child?
Starting a business before you know who will take the helm down the line has an intrinsic risk, as your children may not share the same interests as you. Accept the fact, so that if there is no natural succession, you’re not left disappointed.
Yes, welcome your children into the business as soon as they are willing to join; but give enough freedom for them to explore it on their own terms.
If you have several children who could inherit the organisation, be sure to maintain open communications. Be honest when deciding who is best placed to take on the responsibility of management to avoid family conflict.
Or, if viable, propose a shared-responsibility structure.
Pet Projects
Not every business must become a multinational: often, we want to pursue a passion project in full knowledge that one day, we might have to wind the enterprise down. There’s no harm in acknowledging this, just be sure to manage your investment appropriately.
Provided you set the business up in such a way so as not to affect your personal financial standing – or that of loved ones – there is no harm in one day bringing the shutters down. But don’t overstretch yourself when you know in your heart there is the possibility this is only a short-term project – or at least has a finite lifespan.
